Perspective on the Business of Event Processing

April 2012

April 16, 2012

A year and a half in the making, we're thrilled to release StreamBase LiveView 1.0 (press release). Since we released the concept video last November (which drew almost 4,000 views on YouTube), our early access program has been a huge success. We'll announce an exciting set of customers in the coming weeks from that program.

Here were three "aha" moments I had with those visionary adopters that, for me, crystallize why LiveView is so special.

1. Real-Time Service Experience Management. Recently the head of trading at a big bank told me that when a big buy side client like Fidelity calls to ask about the performance of a trade, they:

Issue a request to IT

IT searches log files, databases, and reports to gather raw data

IT analyzes the data with one or more of: a quant, a risk expert, an execution expert, and a market structure expert

The team writes a report

The team briefs the sales trader on the account

Finally, after 3-5 DAYS - they explain the situation to the client

They decide on a course of action

Adjustments are made - algorithms or strategies are changed

No more. Now, LiveView helps them make many of these decisions in seconds. LiveView creates a live, 360 degree view of order flow, executions, risk, transaction cost, risk, and operations. LiveView lets sales staff see what's happening before the data is lost in an IT black hole of log files, databases, and reports.

Now, the moment the client calls, a salesman, risk manager, or trade execution specialist can answer if orders are being received correctly? Is the risk profile in line? Are the trades in line with the cost benchmarks? Are my 5 EMSs up and running? Are connections to the exchanges fast? Does the client want to adjust their strategies?

The transformation is exciting: a typical reactive support function becomes proactive, opportunities lead to bigger opportunities, and problems become sales opportunities.

2. Real-Time Selling. In January, at a meeting at another bank, a sales trader asked: "Could I ask LiveView in the morning to alert me whenever a big order comes in from an important client using the new algorithm we released last week so I can bird-dog it?"

This was the perfect question, because it strikes at the heart of what LiveView does: it's like setting hundreds or thousands of business probes, and being alerted proactively when one is tripped. The probes can be turned on, turned off, and adjusted on the fly. Any system, internal or external, packaged app or custom built.

Firms that provide a highly automated service to clients need a real-time intelligence system for sales people. The ability to sell more depends on the ability to anticipate that a key client is headed for trouble, or when the time is right to encourage more sales.

And by building real-time intelligence into the system, everyone becomes a sales person, because the conditions that encourage more sales are right in their face.

3. Real-Time Fraud Detection. My last story took 3 months to unfold. Another LiveView early adopter wanted to implement a "fraud detection" analytic with LiveView. The firm needs to monitor machine-driven algorithms, and look for suspicious patterns. Sounds simple, right? Not so simple!

In this case, the patterns of interest required correlation of 5 streams of real-time data. Patterns happen within 15-30 second windows, during which thousands of dollars could be lost. Attacks come in bursts.

The data required to find these patterns was loaded into a data warehouse and reports were checked each day. Decisions to act were made every day.

LiveView now intercepts the data before it hit the warehouse by connecting LiveView to the source of data. It took 3 days to integrate these sources because it took that long to find someone who knew where 3 of the data streams came from!

StreamBase detects fraud patterns in milliseconds. But the really interesting part came next.

Once this firm could see patterns of fraud, they were faced with a new challenge: what to DO about it? How many times did the pattern need to be repeated until active surveillance is started? Should the action be quarantined for a period, or halted immediately? All these questions were new, and the answers to them keeps changing.

The fact that the answers keep changing highlights the importance of ease of use. Analytics must be changed quicky and be made available to fraud experts - in some cases, in hours - as understanding deepens, and as the bad guys change their tactics.

Better, higher value-add customer service for highly automated industries. Knowledge workers who anticipate sales opportunities. Spotting fraud in high-speed transactions streams and taking action. These stories are the stories of the future for the real-time enterprise. These stories tell the story of why StreamBase LiveView is so special.